In a statement, VeriSign CEO Jim Bidzos said the new contract "provides certainty and sets a clear direction for the company."
The annual fee had been $6 for several years, until VeriSign was guaranteed price increases in its 2006 contract. The company took advantage of that and raised the fee to $7.85, a penny short of what had been permitted.
The new contract allows VeriSign to request an end to price caps if it can demonstrate that "market conditions no longer warrant such restrictions." Factors could include reduced demand for ".com" names, competition from other Internet suffixes and increased use of alternative navigation techniques such as search engines.
The contract also extends a provision giving preference to VeriSign for any renewals in the future, without requiring an open-bidding process.
VeriSign's contract is with the Internet Corporation for Assigned Names and Numbers, a nonprofit organization that oversees Internet address policies. ICANN tentatively approved a contract extension with price increases in June, but it needed the Commerce Department's approval. Commerce removed the price hikes and approved the modified contract Thursday.
VeriSign also runs the database for the less-popular ".net" suffix, but that is not subject to government oversight. Under its contract with ICANN, VeriSign is allowed to raise prices on ".net" names by up to 10 percent a year.